Public Health Expenditure, Health And Economic Development

Nation fitness plays an important role for a country to be strong and prosperous, thus how to make a good use of the scarce or limited health resources to meet the growing demand of health demand is and will always be a big issue in academic circles. In the early days of the nation, based on the Chinese government's leading role in public health, there were great changes in the health field. But, after reform and opening-up, in spite of the rapid development of economy, the nation's health status has been improved slowed. And the same time, the government has paid little attention to the public health area, which makes the crisis in this field has grown older and older. Thus, this paper focuses on the relationships of government's health public expenditure, the health status and economic development, and then gives advices based on the research. The research in this paper is based on the pure theory of public expenditure, health function theory, the research of the relationship between health expenditure and economic development and so on. At first, though the review of health protection in China, the paper makes a summary of achievements and shortages. Then through the analysis of scale and structure of government's public health expenditure, the paper reaches a conclusion.As the government is the principal part of health expenditure, the paper set research priorities on the relationship between government's health expenditure and health status. Based on the health function theory, the paper sets the health index, health expenditure index, incoming index, population characteristics index, social characteristics index and sanitary condition index, using the panel data of thirty provinces from the rear2003to2008in China. In this empirical study, the data is classified as nationwide data and territorial data which conclude coastal regions data and up-country districts data. Using the panel data processing method, the per-capita GDP plus lagged periods per-capita GDP and health index are disposed by simple regression analysis, thus a conclusion comes that current income leads a high contribution rate to the future health level. After the regression analysis on the data of regional level and national level, the paper arrives at a conclusion that government's health expenditure has a significant effect on the improving of health status, and even more significant in interior area where the economy is underdeveloped. The other index also plays a role in different direction.In a long time, the government and the main scholars has taken the health protection as a public welfare nonproductive expenditure, without considering its importance to economic growth and society development. And also because of the tendency of valuing more treatment than prevention in health services, the government's expenditure in public health area has been neglected. The role of government health expenditure as a whole to economic development has been researched, so the paper furthers the research by studying the correlativity between government's expenditure in public health area and economy, and testing the relationship between government's health expenditure and total expenditure on health. The paper applies time series method, using the data of China from the1980to2010, and achieves a conclusion that government's expenditure in public health area has a statistically significant positive affect to economic development and improving the quantity of government's expenditure can inhibit the growing total expenditure on health. Based on the former study, the paper tables a proposal:first of all, the government should increase the amount of its expenditure in health; second of all, allocating the duty of governments at all levels in health protection scientifically, to make sure of sustainability of government health expenditure; third, completing transfer payment system, to minimize the expenditure gap between regions, urban and rural areas; at last, public health service should be more valued, thus more expenditure in public health area is necessary.